Scotland's Climate Change Plan – 2026-2040 - BRIA

Section 4: Additional implementation considerations

4.1. Enforcement/compliance

The Climate Change Plan requires no new enforcement processes. The Climate Change Plan must comply with the Climate Change (Scotland) Act 2009 as amended.

4.2. UK, EU and International Regulatory Alignment and Obligations

This sub-section sets out information related to UK, EU and International Regulatory Alignment and Obligations for the relevant sectors contained in the Climate Change Plan.

4.2.1. Business and Industrial Process

There are no direct impacts from the policies set out within the plan. Carbon Capture and Storage will likely rely on importation of CO2 from Europe which will require certain aspects of UK and EU regulation to align or complement one another in the future.

4.2.2. Energy Supply

Not applicable: The key levers of energy policy and regulation that will be required to support delivering this growth in renewable generation are largely reserved to the UK Government. The UK ETS and EU ETS share a cap-and-trade design, but the UK ETS is a separate, independent system that was created after Brexit.

4.2.3. Land Use, Land Use Change and Forestry

4.2.3.1. Peatlands

A unilateral ban on the sale of peat for horticulture in Scotland but not elsewhere in the UK may be rendered ineffective by the terms of the UK Internal Market Act (UKIMA). The mutual recognition and market access principles in the UKIMA mean that peat extracted in, or imported into, other parts of the UK and legally sold there could legally be sold in Scotland, regardless of any ban in place here.

Pursuing a GB or UK-wide approach would ensure that the UK Internal Market Act does not undermine an effective peat sales ban in Scotland.

This approach would also address concern expressed by industry in response to our 2023 consultation. Industry stakeholders believe that a unilateral Scottish ban on the sale of peat for horticulture could fragment established UK supply chains and disadvantage Scottish businesses, creating regulatory and logistical challenges.

Scottish Government engages regularly with UK government and the other devolved governments at both Ministerial and Official levels through the Inter-Ministerial Group for Environment, Food and Rural Affairs, a four nations horticultural peat group and ad hoc correspondence. Through these channels, all legislative options for sales restrictions on peat are currently being explored.

4.2.4. Buildings (Residential and Public)

While there are no direct impacts from the policies set out within the plan for the residential and public sector, the heat network policies proposed (and subject to separate Impact Assessments) will bring Scotland into closer alignment with approaches taken in England and Wales, supporting consistency across the UK and helping to streamline market and regulatory expectations.

4.3. International Trade Implications

4.3.1. Business and Industrial Process

There are no direct impacts from the policies set out within the plan. Carbon Capture and Storage will likely rely on importation of CO2 from Europe which will require certain aspects of regulation to align or complement one another in the future.

4.3.2. Land Use, Land Use Change and Forestry

4.3.2.1. Peatlands

In 2022 the UK imported 0.34Mm³ (35%) from Republic of Ireland and 0.22Mm³ (23%) from other EU countries, totalling 57% from the EU as a whole. The banning of the sale of peat and peat products will, therefore, reduce this import into the UK.

In 2022 the UK exported 20,000m³ of peat for growing media. In that year 44% of peat produced in the UK and used in UK growing media originated in Scotland. Making the assumption that the proportion of exported peat matches the origin of that used within the UK, we can estimate a loss of exports of 8,800m³ of peat for use as growing media from Scotland. It is unlikely that this would be replaced by alternative materials exported from Scotland.

In 2022 the UK exported £52.82 million worth of ornamental plants. The share that originated in Scotland is unknown, however, if we make the assumption that 44% of plants are grown in Scottish peat in the UK, matched to growing media extraction data, this could reach £23.24 million in exports supported by Scottish peat. A ban on sale of peat in horticulture would also likely reduce the competitiveness of Scottish grown plants, due to increased costs and potential lower quality of plants, at least in the short term.

Changes to UK and EU rules following Brexit mean that there is currently little to no export of plants from the UK to the EU. Seed potato exports for the 2022/23 growing season were 91,390 tonnes, 59% of which is exported to Egypt. This export would cease until an alternative growing medium could be found for mini-tuber production.

4.4. EU Alignment Consideration

The Climate Change Plan has no EU alignment implications.